Analyst: Euro PS3 delay threatens US publishers

UBS Investment Research analyst Michael Wallace assessed the PlayStation 3 and Wii launch plans of a number of US publishers in a note to investors today, and not all of the news was positive. While Wallace noted that software sales were already up about 3 percent for the year so far (matching his original prediction for the full year), he warned that the delay of the European release of Sony's system may have a negative impact on some companies' bottom lines this year.

Wallace had expected Sony to ship about 500,000 PS3 systems to Europe by the end of the year, but with the system not expected to release there until March of 2007, he worries about the impact it will have on US publishers. Aside from having 500,000 less consumers to sell their games to, publishers may decide to delay games that had been expected this year into 2007 to take advantage of what will be a larger user base. However, Wallace doesn't specify any particular titles that would be in danger of this and notes that if Sony can ship 1.5 million PS3s to the US by year's end, it would make up for the shortfall of systems caused by the European delay.

As for which publishers face the biggest downside as a result of the delay, Wallace said that Activision has built its quarter around the PS3 launch more than other publishers and could suffer the largest downside as a result. While he expects Electronic Arts to have four or five PS3 games at launch compared to Activision's three, Wallace also said that EA has a more balanced portfolio for the quarter.

Even the caution about Activision is tempered with a note that the publisher could make up any losses in other areas of its business. Wallace said that Nintendo's expected 2 million Wii units available for the US by the end of the year is more than he expected. As a result, Activision and THQ are best positioned to take advantage of that, with five games and four games expected for the Wii launch, respectively. (Wallace does not issue reports on foreign publishers like France-based Ubisoft, which has announced a lineup of eight Wii titles and is expected to offer PS3 launch titles as well, including Blazing Angels: Squadrons of WWII.)

Wallace's list of expected Wii and PS3 launch titles from the publishers he covers is included below.

Activision
Call of Duty 3 (PS3, Wii)
Marvel: Ultimate Alliance (PS3, Wii)
Tony Hawk's Project 8 (PS3)
Tony Hawk's Downhill Jam (Wii)
World Series of Poker (Wii)
Rapala Tournament Fishing (Wii)

Atari
Dragon Ball Z: Budokai Tenkaichi 2 (Wii)

Electronic Arts
Madden NFL 07 (PS3, Wii)
Need for Speed Carbon (PS3, Wii)
Tiger Woods PGA Tour 07 (PS3)
Fight Night Round 3 (PS3)
NBA Live 07 (PS3)

Midway
Ant Bully (Wii)
Happy Feet (Wii)
Rampage: Total Destruction (Wii)
The Grim Adventures of Billy and Mandy (Wii)

Take-Two
NBA 2K7 (PS3)
NHL 2K7 (PS3)
College Hoops 2K7 (PS3)

THQ
Cars (Wii)
SpongeBob SquarePants: Creature From the Krusty Krab (Wii)
Avatar: The Last Airbender (Wii)
Barnyard (Wii)